Bill C-2 (Historical)

An Act to amend the Income Tax Act

This enactment amends the Income Tax Act to reduce the second personal income tax rate from 22% to 20.‍5% and to introduce a new personal marginal tax rate of 33% for taxable income in excess of $200,000. It also amends other provisions of that Act to reflect the new 33% rate. In addition, it amends that Act to reduce the annual contribution limit for tax-free savings accounts from $10,000 to its previous level with indexation ($5,500 for 2016) starting January 1, 2016.

Instruction to Committee on Bill C-2

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

moved:

That it be an instruction to the Standing Committee on Finance that, during its consideration of Bill C-2, An Act to amend the Income Tax Act, the Committee be granted the power to divide the Bill in order that all the provisions related to the contribution limit increase of the Tax-Free Savings Account be in a separate piece of legislation.

Mr. Speaker, as everyone knows, we are currently examining Bill C-2 at the Standing Committee on Finance. It was the first bill introduced by this government and it amends the Income Tax Act. When you look at the contents of the bill a little closer, it is clear that it contains two separate measures. The first measure has to do with changing the tax rates. The change this government is proposing targets the second tax bracket, whose tax rate would drop from 22.5% to 20%. The second measure has to do with the contribution limit for tax-free savings accounts, which the Conservatives had increased to $10,000 a year. This bill drops that limit back to $5,500.

I would like the House to instruct the Standing Committee on Finance to separate the bill so that the two issues can be addressed separately, because they are two fundamentally different issues.

Let us look at the TFSA, the tax-free savings account. Many people think or are under the impression, due to the way it was presented to the Canadian population, that it is basically a savings account for retirement, that people put money aside in that account after paying taxes on it, and that it can actually grow with interest and returns, and they will eventually be able to take that money out tax-free because they already paid tax on it.

If we look deeper into the TFSA, we see it is a bit more complicated than that. It is more complicated because it is not only money that can be put in this account. People can put all kinds of things in this account. They can put stocks, bonds, derivatives, and all kinds of financial tools.

The concern with raising the ceiling to $10,000 was the fact that it became something other than a retirement savings mechanism. It became, basically, a way to shelter returns on financial investments. If I invest in the stock market and make a significant return on my investment, I will not pay the same income taxes as most of the population. With this money, I will be taxed only for half of what I would be earning, and I will only pay taxes on a portion of that half, while people earning incomes through work will actually be taxed on the entirety of their gains. We are in a situation right now where capital gains have a different tax status from income tax gains, basically.

When the ceiling was raised, there was a possibility that it could be no longer used as a savings mechanism but as a slush fund, in which people would deposit money, play the market with it through a variety of financial tools, and eventually escape the capital gains tax altogether. This possibility, I would submit, is not available to the large majority of Canadians. Those who have the means to play the stock market or the derivative market is actually a very limited number of people.

Many analysts who are studying the TFSA and the impact of the increased limit have been concerned about this. The Parliamentary Budget Officer, among others, estimated that the limit increase would have some serious adverse effects. In his update of the analysis of the TFSA limit increase, he estimated that by 2080, the long-term fiscal impact of the TFSA would reach 0.65% of the GDP. That is almost 0.7%. We are constantly being told in the House that it is impossible for Canada to meet its international aid commitments of 0.7%, because there is not enough money. However, this TFSA limit increase would have nearly hit this objective, but just a small part of the population would have benefited. The Parliamentary Budget Officer noted this as well. He looked at the distribution of TFSA benefits by wealth.

If we divide the population into groups, each representing a 20% wealth bracket, we see that the 20% representing the wealthiest households would receive a greater tax benefit than the remaining 80% of families who are not high-wealth households.

Therefore, we see that the Conservatives' proposal was extremely detrimental to the country's fiscal situation. In fact, it opened the door to the use of this mechanism not only as a retirement savings tool, but more so as a tax shelter for capital gains. The capital gains tax is already much lower than taxes on people's income, for example on working income. The concern that is being raised by many is that instead of being a savings mechanism, it almost becomes a rather significant tool for tax avoidance, and it will not be used for the purpose it was intended when it was introduced and passed in the House.

That is one measure that the government finally wants to reverse. Instead of keeping the 2015-16 ceiling of $10,000, the government wants to bring it back down to $5,500. That is one measure we agree with. We floated the idea during the election campaign. We believed that the amount of $5,500 was sufficient for reaching retirement savings goals.

In fact, depositing $5,500 for ten years, for example, will yield $55,000 plus interest, which is tax-free. That is in addition to the other existing tools, such as RRSPs and the benefits people will have access to at 65, such as old age security and savings under the Canada pension plan or the Quebec pension plan.

The TFSA is an additional mechanism that can be used, a tool among many others. We believe that the $5,500 ceiling is adequate.

Now, there is a second measure in Bill C-2 which is extremely different from the ceilings of the TFSA. That is the modification of the tax brackets. The bill proposed to change a second bracket.

For those who might be listening at home, right now we have four tax brackets in Canada. The first one applies to income of $11,000 to about $45,000, which is at 15% right now. Then any income between $45,000 and about $90,000 is taxed currently at 22%. Then income of $90,000 to about $135,000 is taxed at 26%. Over that amount, income is taxed at 29%.

The bill makes two changes. It decreases the second bracket, so for all revenue, all income from $45,000 to $90,000 the rate is decreased from 22% to 20.5%, and it adds another bracket for those earning over $200,000 that will be taxed at 33%.

During that debate and during the campaign, I was actually a bit surprised at the low level of understanding of how our tax system works. That reduction on the amounts between $45,000 and $90,000 will not only affect those earning a total of between $45,000 and $90,000, but it will actually be applied on all income over $45,000.

Right now, somebody earning $150,000, an ordinary member of Parliament, for example, who earns about $135,000, will actually have a 1.5% reduction of his or her taxes on all the income between $45,000 and $90,000. Before $45,000, that income will be taxed 1.5% less.

Many people are under the impression that people earning over $90,000 will not be affected. On the contrary, they get the full tax reduction at that level.

We are going through the analysis. Much analysis has been done, including by the parliamentary budget officer. What we are seeing is that while the Liberals, during the campaign promised to have a middle-class tax cut, it is clear that those earning less than $45,000 will not see a single cent of that tax reduction. It is clear. It only affects people earning over $45,000.

I have been told in no uncertain terms that those who earn $35,000 to $45,000 might legitimately claim to be members of the middle class, which is a very difficult term to define. One way to define it is to look at all the income divisions in Canada, to exclude the 20% who earn the most, the 20% who earn the least, and that would give us a middle class that is anywhere between $20,000 to $60,000. That would be, roughly, what the middle class is in terms of income per year. There is a large chunk of that group who would not get a cent of that tax reduction. Therefore, to call this a middle-class tax cut is, in my mind, misleading.

There is a second part of it, which was supposed to pay for the lost revenues. That is the new tax bracket of 33% for income over $200,000. We know, and the government was forced to admit it, that it will not pay for the tax reductions. We all agree on that. Not only will it not pay for those tax reductions, but even people making an income over $200,000 would still have an overall tax reduction, even though this was supposed to impose more on them, because they still get the full tax reduction of that second bracket. That means someone earning $210,000 would still have an overall tax reduction. Someone earning $215,000 would still have an overall tax reduction. Is that what we mean by a middle-class tax cut?

For those of us on this side of the House, there is a problem. We agree with one large measure that would, if it is not addressed right now, have significant fiscal impact on the Canadian government. On the other side, we disagree with the measure that we find is misleading and which is not achieving the aims that were presented to the Canadian population especially during the election.

In addition, we still wanted to be constructive, since Canadians elected this government in part because of its promise to lower taxes for the middle class. We respected the verdict and we made a proposal to the government. Rather than excluding a large portion of the middle class, rather than simply reducing the second tax bracket, let us reduce the first tax bracket, the first level of income at which people have to start paying taxes. This tax bracket starts at approximately $11,000 because people are given a basic exemption that is not taxed. We proposed to reduce that tax bracket from 15% to 14%, a 1% reduction. What would that do? It would allow people who really belong to the middle class to benefit from this tax reduction. It would allow people who are currently getting a 1.5% reduction on income over $45,000 to have a 1% reduction on a similar income. It would make it possible to ensure that people who are earning $210,000 a year are not being given a tax cut. This is a series of measures that I believe all Canadians would agree with.

For reasons that cannot be explained, the government is opposed to this measure. So be it. However, I do not think that the government can disagree with the fact that the two measures in question are totally separate issues. I think that each one should be examined on its own merit. The Standing Committee on Finance has done some of the work. I also believe that it is in the government's best interest to move in that direction. We are offering the government an advantage on a silver platter. The media had a field day when these measures were presented to the Canadian public. We are offering the government the opportunity to hold two separate debates and two separate votes on the measures that it is presenting, measures it is proud of. It would be really worthwhile for the House to be able to vote on whether the bill should be divided. I know that I presented some extremely technical information, but it is hard not to get technical when we are talking about income tax. Finally, the two measures have completely opposite effects.

It goes to the notion of transparency and the notion of accountability as well that the House could actually pronounce itself separately on those measures.

We will have that chance in the finance committee. Bill C-2 is only 10 clauses long and we will do a clause-by-clause study. We will vote clause by clause in the finance committee, so we will have the opportunity to demonstrate in committee which clauses we are in favour of and which we are not.

Since Bill C-2 is the first bill presented by the Liberal government and it is one of the key measures that it wanted to bring forth to the Canadian population, it is important that the House have the opportunity to do the same and to vote separately on those arguments. It would be beneficial for the trust that the population puts in the Liberal government. It goes to the issue of credibility as well. It would go toward contributing to the answer to the question that many have asked so far.

Since we voted on the ways and means motion on which we could not divide per se, people were under the impression that starting on January 1, they would have a tax reduction if they considered themselves part of the middle class. Starting on January 1, when they saw their pay slips, they might have been surprised not to see any changes. They still do not understand.

I have not really heard the government so far in this debate talk about the technical aspects of it publicly. I hear the answers given either by the minister or parliamentary secretary saying that the government has given the middle class a tax cut, period.

This calls for some clarification. Here in the House, there are 338 MPs who represent all Canadians. The government would do well to clarify this. We are giving the government the opportunity to do that so we can debate these two points on their merits.

That is why we moved this motion to divide the bill into its two main parts. These main parts encompass all of the other elements, such as changes to the law and the tax credit formula for charitable donations. That formula generally uses the highest individual percentage, which will be changed, so it will have to be changed too.

This is not a very complicated issue. Can we divide the bill in two so as to deal with changes to the tax-free savings account and the tax brackets separately? That is what we are suggesting to the government.

I hope the members of the House will support this so we can clarify the work the Standing Committee on Finance is now doing and ensure that we are accountable and transparent to Canadians.

Financial Statement of Minister of Finance

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, it gives me pleasure to speak to the budget entitled “Growing the Middle Class”.

Let me start with a quote from the Minister of Finance himself. He really summed it all up in his opening remarks. He said:

Today, we begin to restore hope for the middle class. Today, we begin to revitalize the economy. Today, we begin a long-term plan that will use smart investments and an unwavering belief that progress is possible to ensure that Canada's best days lie ahead.

As I said, that really sums up what this budget is all about. It sums up the objective of the budget. However, the budget is made all the more difficult by what the previous government has left us, or has left us without. Program after program was cut by the previous government. Earlier, the Leader of the Opposition talked about how the Conservative government had a surplus. No it did not. That was a surplus on a monthly basis, but accounting is usually done over the long term. The Conservatives left this country with $160 billion of added debt imposed on every citizen in this country. Not only did they leave us with debt, as I said, but they also cut programs and services. Even worse, they created disunity in the country.

If we are going to bring Canada ahead as a federation, we need to have a government that is willing to work with the provinces, to work together to grow the economy, to put in programs that we can utilize together to create growth in the economy and jobs for Canadians.

In reality, the budget builds on the measures introduced in December which provided a middle-class tax cut. We are dealing with that now with Bill C-2. Really what that did is bring better balance to the taxation system by giving those in the middle class a tax break and balancing that by taking a little more from those who can afford it. This budget builds on that commitment.

One of the key parts of this budget is looking to the future. That is done with the Canada child benefit, assisting those families in raising their children, giving them better opportunities to spend money where it is needed. The Canada child benefit will replace the current complicated child benefit system.

The Canada child benefit will provide a maximum annual benefit of up to $6,400 per child under the age of six, and up to $5,400 per child for those ages six through 17. Families with less than $30,000 in net income will receive the maximum benefit. Nine out of 10 families will receive more child benefits under this program than under the current system. Specifically in my own province of Prince Edward Island, they will receive $47 million more in child benefits during the 2016-17 and 2017-18 period. That is a benefit to families. It is putting the money where the resources should be put.

Not only are we dealing with families, but we are also dealing with the education of students so that we build for the future down the road. We are making post-secondary education more affordable through this budget. We are enhancing Canada student grants to give young people the opportunity to be able to afford to go to university and college.

Budget 2016 proposes to increase Canada student grants by 50%, from $2,000 to $3,000 per year for students from low-income families, from $800 to $1,200 per year for students from middle-income families, and from $1,200 to $1,800 per year for part-time students. We are not only building on the very young people, but we are building the education system as well for all Canadians.

I know this area is a little controversial, but for all Canadians we are improving the safety net for those who find themselves in difficult times as a result of being out of work. We are improving the employment insurance system after the disastrous way it was handled by the previous government.

We are expanding access to new entrants and re-entrants by dropping the 910 hours' entrance requirement to whatever the regional rate is. We are reducing the two-week waiting period to one week. We are improving the program for working while on claim. That is extremely controversial. It was extremely controversial in my area, because under the previous government's system, a person was penalized for going to work. Even people who were on maternity leave were penalized for going to work and keeping up their skills, especially those who worked in a hospital setting for one day a week while on maternity leave.

I do not mind admitting that there is some controversy around the next point I will make, and that is extending the five-week pilot project to those areas that were hardest hit by the downturn in the economy. I would say there is some controversy in my own region over that because that five weeks was not applied in that particular region, but it is targeted to those areas which have been greatly impacted by the downturn in some of the commodities in the marketplace.

The minister has committed to look at that into the future. The minister has committed to review the employment insurance system and those measures going down the road. I look forward to that review, to ensure that we get fairness and equity throughout the total measures around employment insurance in this country.

We improved the safety net for those finding themselves out of work. I do not have the time available to go into it, but we do look beyond employment insurance and we are investing in skills and training. We are enhancing the investments in training itself, strengthening the union-based apprenticeship training, supporting flexible work arrangements, and improving labour market information for Canadians. We are trying to put that workforce in a place where their skills will be needed in the future and expand on those skills to grow the economy.

However, it is not enough to deal with today's reality. We are looking at the long-term future. During the election campaign we talked a lot about investment in infrastructure. While we are looking at $11.9 billion over five years starting right away, budget 2016 puts this plan into action with an immediate down payment on this plan: $3.4 billion over three years to upgrade and improve public transit systems across Canada; $5 billion over five years for investments in water, waste-water, and green infrastructure; $3.4 billion over five years for social infrastructure, including affordable housing, early learning and child care, cultural and recreational infrastructure, and community health care facilities.

We are investing in the future. Specifically in my comments I should make this point: Major transfers to Prince Edward Island will total $582 million in 2016-17, an increase of $29 million from the previous year; $380 million through equalization, an increase of $19 million from last year; $147 million through the Canada health transfer, an increase of $8 million from the previous year; $54 million through the Canada social transfer, an increase of $1.6 million from the previous year.

My point is, my province benefits from this budget in terms of the transfers, in terms of the programs, and Canada as a whole can look to the future with opportunity and excitement because of what this budget does.

It addresses the problems created by the previous government and puts in place investments in families, infrastructure, education, and skills training, which is what Canadians really need to grow, with opportunity and the hope for prosperity in the future. That is what the Minister of Finance has done in this budget. I ask everyone in this House to be supportive of that to help build Canada's future.

Public Service Labour Relations Act

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, it is a privilege to stand in this place to share some thoughts on yet another very important piece of legislation, something that I suspect people should be supportive of.

I have had the opportunity on previous occasions to address different types of legislation. I would recommend that my colleagues, no matter what side of the House they are on, take into consideration that this legislation is before us because there was a Supreme Court of Canada decision that was made, and as a result legislation was then required. I would argue that this type of legislation could have, and possibly should have, been introduced long ago, even prior to the last federal election. I think it would have been nice to have had something in place.

I am very happy with the approach that this government has taken in addressing legislation, in particular with some of the labour issues. I truly believe that we can do much more in terms of improving the quality of the relationship between labour and management, not just within the private sector, but also the public sector.

A couple of weeks ago, I met a member of the public union at a local restaurant. He shared with me a questionnaire that was circulated among the civil service. It was discouraging. The questionnaire results were based, I believe from 2014. The results were very disturbing, in the sense that there is a high level of dissatisfaction, of mistrust. There is this sense that the Government of Canada was not listening to the needs of Canada's public service, or at the very least was not demonstrating respect for our civil service.

There has been a change in attitude since the last federal election. We have seen our new Prime Minister and the Canadian government take a different approach in dealing with our civil service, or unions in general. We recognize the valuable contributions they make to our society. This is ultimately recognized, not only here in terms of the citizenry of our country, but also in other jurisdictions in the world that have recognized the professionalism throughout our public service.

I tried to assure my constituent when he was sharing these very poor results from 2014 that there is a new attitude in Ottawa, in terms of appreciation and gratitude for the phenomenal work that our civil service puts in.

When I look at the legislation before us today, it is an extension of other areas in which the government is trying to demonstrate that things have changed. There was a four-month extension that was given.

I listened to the comments, whether they were from Conservative critic or the NDP member of Parliament from Elmwood—Transcona, about wanting to see changes. I have good news for them. The good news is that we within government want to see change in the way in which our standing committees themselves operate. If the opposition takes the gesture that is coming right from the Prime Minister and the cabinet, and in essence from the government benches, I would suggest that we will see amendments brought forward, not only potentially to Bill C-7, but to other pieces of legislation.

I had the opportunity to serve over 20 years in opposition, and I have often had a sense of frustration when I wanted to see amendments brought forward, and for whatever reason—usually because they came from the wrong side of the committee—opposition amendments were just completely outright rejected.

I am suggesting, as have other colleagues, that there is a new open attitude toward the way in which committees and standing committees could be working into the future.

I tend to agree with the Prime Minister that a lot of the heavy lifting and the hard work can in fact be done in our committees. Therefore, when the member for Elmwood—Transcona talks about some of the ways he believes we have fallen short on the legislation, let me suggest for him and for all members—it does not matter whether they are even on the opposition benches, so even for my colleagues on the government benches—that if they are prepared to do the work and the consultation and share their ideas in a proactive fashion, in a progressive manner, they should not be surprised to see their amendments actually accepted and ultimately improve the legislation.

That could happen with Bill C-7 or any other piece of legislation, but the onus and the responsibility in good part is on those who are sitting on the committee. At the end of the day, if we are passing legislation through second reading and a member has some thoughts and some ideas that could improve the legislation, the government is open to listening to them. Why would we not approve, or at the very least consider, amendments that would improve the quality of the legislation itself? All Canadians would benefit from that. The Prime Minister has spoken out on this. We want to see more effective and functional standing committees that will ultimately contribute to improving the system.

I recognize, in the hour or hour and a half in which we have had the opportunity to debate this issue, that there were a number of members who talked about the importance of amendments. Let me qualify that by saying—and the parliamentary secretary in particular made reference to a fairly extensive survey where literally thousands of RCMP officers were consulted and feedback was solicited, and we received a considerable amount of information—that we understand what is being asked of the government in coming up with the legislation as to what they would like to see in the legislation. I will make more reference to that a little later in my comments.

We have to look at amendments to legislation from a holistic approach, everything from the legislation itself and the impact an amendment would have on the legislation, to what degree we are hearing from the different stakeholders and the witnesses who ultimately appear before a committee.

One of the things I really enjoy, coming from a provincial legislature to the House of Commons, is the degree to which standing committees have the ability to bring experts from across the country to provide their input on legislation—and on other matters, but specifically on legislation.

When the bill ultimately goes to committee, we will hear from experts from virtually all regions of our great nation, coming forward, sharing their thoughts, and I suspect from a combination of what they, opposition members, and government members are saying, that we might actually see some amendments brought forward.

I decided to take some time to emphasize the importance of this because there is a time limit. I do believe there is some merit to see the bill ultimately pass in a timely fashion.

As has been pointed out, the Supreme Court of Canada made its decision in January 2015. It said we needed to change the law to enable our RCMP, a wonderful national institution, to unionize if it chose to do so.

We were given a year. We had to apply for that four-month extension. From a court procedural sense, we need to speed up the process if we can. However, it should not be only about the perspective of the court. Many members of our RCMP have been anxiously awaiting this. The sooner we put this in place, then the sooner we would be allowing those fine members, who have served us so well over the years, to do what they would like to do.

There are two good reasons why I would recommend to my colleagues, no matter what side of the House they sit on, that they allow this legislation to go to committee. The sooner it gets to committee, the more opportunity the committee will have to deal with the many different issues that have been raised so far in the debate. Ultimately it will come back from the committee, and looking at the actual number of sitting days and the government's proposed legislative agenda, we see that time is a scarce commodity in this chamber. We could do a great service by recognizing the value of getting the bill to committee stage.

A number of thoughts came to my mind while I was listening to the Conservative critic, and I wanted to pose a question for him in regard to those thoughts. Some of his remarks were a bit off topic, for example, when he referenced debt and deficit that he attributes to Liberal prime ministers. If he has been listening closely to what the government has been saying, he is probably finding it intellectually challenging as to why he might stay on that side, given the number of times he has quoted Liberal prime ministers. Rather than adding more comment on that particular issue at this time, I will wait until we get the opportunity during budget debate. Suffice it to say that, when the member referenced the deficit, I would suggest that the Conservatives had a huge deficit and debt issue, far exceeding any Liberal administration since Confederation.

The member also made reference to Bill C-4 as if it were bad legislation. I am from Winnipeg, and maybe it is because Winnipeg faced the general strike of 1919 that I tend to differ with the Conservative Party. I recognize the valuable role that unions play in society, both today and into the future, but the Conservative Party in particular does not recognize this. We saw that with respect to the questions the member put forward and his statements while addressing Bill C-7. The member was critical of Bill C-4, but he does not recognize that Bill C-4 would improve Canada's labour legislation, just like the bill we have before us today. If passed, Bill C-7 would improve the labour situation here in Canada.

Bill C-4 is not the government's first priority piece of legislation. Our first priority was Bill C-2, which concerned our tax break for the middle class. Bill C-4 is a priority because the Conservatives changed labour legislation to the detriment of the union movement in Canada. That particular piece of legislation was brought in to rectify a wrong that the Conservatives had put in place.

That is the reason why I suggested earlier that the Conservatives have a different approach to dealing with labour legislation, which has ultimately led to what we have in Bill C-7 today. They had eight or nine months to deal with the legislation in some form or another. They have talked a lot about the secret ballot. They had the opportunity to put that into the legislation if they were prepared to bring it forward back then. However, it was a low priority, even though the Supreme Court of Canada had ultimately made a ruling. I would suggest that the Conservatives were negligent on this file and, as a result, that has created a time crunch, and I hope and I trust that all members will recognize that.

Before I get into more of the details of the legislation itself, I did want to pick up on a couple of important points. The most important one is that this legislation was brought forward to deal and assist with a free bargaining process for our RCMP officers. I do not think that enough could be said about the incredible work that our RCMP officers do from coast to coast to coast. The RCMP is one of those great Canadian institutions from which Canadians as a whole get a great sense of pride, especially when we see the traditional red uniform with the hat. It is something I believe embodies a great sense of pride for Canadians. It is an iconic institution that is recognized around the world as one of the greatest police forces of modern time. I believe we should all pay tribute to the fantastic work that the RCMP does.

We need to also recognize that this is not the first time that a police or law enforcement agency is looking at the possibility of forming a union. We have had police unions in Canada dating back almost 100 years, so Canadians do not need to be fearful of a union, as some members on the other side might try to espouse. There is a great deal of benefit to recognizing the valuable role unions have played in police forces in Canada to date. It is not as if we are going into an area that has never been explored in the past. The opportunity for the RCMP to unionize is very real, and I suspect it will likely happen. However, at the end of the day, it is the RCMP that will ultimately make that decision. The important thing to recognize is its right to have a collective bargaining regime. That was the essence of the ruling that was made by the Supreme Court.

I will highlight this fact. In that massive consultation and surveying that was done with RCMP officers, there were a couple of points that need to be recognized. One was that there was strong support for a union throughout all of those consultations and so forth. There was also strong support for a single national bargaining unit, and the idea of binding arbitration versus the ability to strike.

With those very few words, I trust and hope there will be a few questions.

Business of the House

[Dominic LeBlanc, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, perhaps there might be consent for me to table this very incisive statement that members are about to hear.

Today, we will continue our second reading debate of Bill C-6 on citizenship. Tomorrow, we will continue to discuss Bill C-2 on the middle-class tax cut. There have been discussions among several members, and I believe we will be able to conclude second reading debate tomorrow. Next week, as my colleague mentioned, we will be working very hard in our constituencies.

Monday, March 21 will be the final opposition day in this supply cycle.

On Tuesday, we will take up debate again on Bill C-6, until 4 p.m. I know that members on all sides are looking forward with great enthusiasm to the Minister of Finance presenting his budget at that time.

On Wednesday and Thursday of the week we are back, the House will have the two first days of the budget debate.

Finally, on a serious note, there have been discussions among the parties, and I believe if you seek it you will find unanimous consent for the following motion. I move:

That, notwithstanding any standing order or usual practice of the House, one minister of the Crown be permitted to make a statement pursuant to Standing Order 31 on Friday, March 11, 2016.

[Dominic LeBlanc, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, this afternoon we will continue with debate on the opposition motion that we began this morning.

Tomorrow, we will have the final day of debate at second reading on Bill C-4, concerning unions. I would like to note that the votes relating to this bill will be deferred to the end of the day on Monday, March 7, pursuant to an order adopted earlier today.

I want to sincerely thank my colleagues in the House for their co-operation in finding an agreement on this matter, and also on the ISIL motion, which was debated earlier this week.

Next week, as my colleague indicated, members will be working in their ridings.

On Monday, March 7, we will resume debate, at second reading stage, of Bill C-2 concerning a tax cut for the middle class. I would like to inform the House that Tuesday, March 8, will be an allotted day. On Wednesday, we will begin debate at second reading stage of Bill C-6 on citizenship, which was introduced this morning by my colleague, the Minister of Immigration, Refugees and Citizenship. On Thursday, we will begin consideration of Bill C-5 concerning public servants' sick leave.

Finally, Mr. Speaker, I know that you have been looking forward to this. Pursuant to Standing Order 83 (2), I would ask that an order of the day be designated for the Minister of Finance to present the budget at 4 p.m., on Tuesday, March 22, 2016.

Employment Insurance

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, I appreciate the question from my colleague across the way. I believe I did make reference to that aspect of the program in my speech, when I said we supported a proposal that would allow workers to choose which system benefited them individually.

What we have before us today is a motion. The real meat of the issue has to come in the form of legislative change. I would have preferred to have seen that legislative change come in Bill C-2, but unfortunately, the member's party had other methods that it wanted to pursue. Many of the changes we are proposing can be brought forward in a government bill. We do not need to wait for the budget. If we are serious about immediate action for those who are suffering, the government should bring us a bill, show us something we can work with, and we will look at some amendments if necessary.

Business of the House

[Dominic LeBlanc, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, I know colleagues look forward to this every week. I will be brief.

This afternoon, we will continue with the debate on the Conservative opposition motion.

Tomorrow, we will resume debate on government Motion No. 2, which was moved by the Prime Minister yesterday, concerning Canada's fight against ISIL.

I am currently negotiating with the House leaders of the other parties to come to an agreement on the length of the debate. We will continue debating that motion next Monday and Tuesday. If we manage to conclude the debate on Tuesday evening, on Wednesday we will proceed with second reading of Bill C-2, an act to amend the Income Tax Act.

Finally, Thursday of next week will be an allotted day.

Canada Labour Code

[Erin O'Toole, Conservative, Durham, ON]

Madam Speaker, the member always has very insightful questions in this House.

I cannot put myself in the shoes of the new government, and I certainly would not want to be in those shoes. However, if we look at the first 100 days—and there is a snazzy video out on the first 100 days—we can see the legislative agenda.

Bill C-1 is a formulaic administration-of-oaths bill; Bill C-2 was tax increases and the elimination of the TFSA; Bill C-3 was a massive injection of spending, in large part to cover a promise on the Syrian refugee resettlement; Bill C-4 is the unwinding of labour modernization from the previous Parliament, clearly a quid pro quo for support during the election; and Bill C-5 is undoing the sick day negotiation with the public service.

If we look at the legislative agenda of the new government in the first 100 days, it is tax, spend, and support the friends who got them into office. Contrast that with the previous government's first 100 days. There was the Federal Accountability Act, child care benefits for all families, and a GST reduction. It was about giving back to Canadians, not taking away.

Opposition Motion—Department of Finance

[François-Philippe Champagne, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I will be sharing my time with my colleague from Mississauga—Lakeshore.

It is a privilege for me to be here to participate in this important debate on today's motion.

I would like to reassure my hon. colleague that we have complete confidence in the abilities of the dedicated officials at the Department of Finance, who are currently working on the 2016 budget.

I can say that our budget will flesh out our plan to grow the economy, a plan that has the support of the Canadians who gave us a majority mandate last fall.

First of all, the government believes that all Canadians should have real and equal opportunities to succeed. This will be achieved by strengthening and growing the middle class. That is what we said throughout our election campaign, and that is what we are offering Canadians.

It will come as no surprise when I say that Canada is going through tough economic times. Although the recent U.S. economic performance is encouraging, emerging economies, especially China, are cause for concern.

Many analysts were counting on emerging economies, such as Brazil, Russia, India, China, and South Africa, to help stimulate economic growth. We now know that this will unfortunately not be the case.

Canada's economic performance was weak in 2015, which can primarily be explained by last year's drop in the price of oil. Make no mistake about it, the Government of Canada will post a deficit for the 2015-16 fiscal year, and this deficit is the result of what the previous government did and did not do. That is a fact.

The previous Liberal government left a $13-billion surplus in 2006. The Conservative government wasted this surplus and racked up more than $150 billion in additional debt, all the while managing to achieve the worst growth record since the Great Depression. Those are facts.

Our colleagues have told us all kinds of tales this morning, but what I just said is the truth. All of that, with no plan to grow the middle class, no plan to invest, and no plan for growth. That is the Conservative government's disastrous record.

It is quite likely that the global economy will remain unfavourable in the future and that the price of commodities will remain low. There is no doubt that, as we begin to put our plan for economic growth and long-term prosperity into action, we are up against fierce headwinds.

However, in the face of this real challenge, there is also real opportunity to put in place the conditions to create long-term growth. This growth will create good jobs and help our middle class, the lifeblood of our economy, to prosper.

This is a good time to make targeted investments to support our country's economic growth. However, I want to be clear. We are going to focus on smart investments that promote economic growth while maintaining a commitment to fiscal responsibility.

We intend to focus on two particularly challenging issues. The first is restoring economic progress for the middle class, the backbone of our economy. We simply cannot claim that our country is prosperous if our middle class is having trouble making ends meet.

That is why the government followed through on its promise by making a tax cut for the middle class the first order of business on December 7, 2015. I am proud to say that, as of January 1, approximately nine million Canadians are receiving significant tax relief. This is a fair measure, and it is the smart thing to do for our economy.

In order to achieve this goal, we introduced Bill C-2, an act to amend the Income Tax Act.

This bill is merely the first step in our plan to grow the economy in the long term, create jobs, and help Canada's middle class prosper.

More specifically, Bill C-2 will cut the personal income tax rate, dropping it from 22% to 20.5%, and establish a 33% tax rate for individual taxable incomes above $200,000. We are asking the wealthiest Canadians to contribute a little more.

Lastly, we are lowering the annual contribution limit for tax-free savings accounts, TFSAs, from its current $10,000 back to its previous amount, which was $5,500, and we are also reinstating the indexation of that limit. Our middle-class tax cut and the accompanying changes will help make the tax system fairer. As I mentioned, this bill is just the beginning of our government's measures to grow the economy.

In the next budget, we will introduce the new Canada child tax benefit, another important measure that will provide increased support to the vast majority of Canadian families and help lift hundreds of thousands of children out of poverty. That is right, I said hundreds of thousands of children. Unlike the existing program, the Canada child tax benefit will be simpler, more generous and more targeted to those who need it most. Plus, it is tax-free.

Together, these measures will help strengthen the middle class and help those who work hard to be a part of it. As a result of these measures, Canadians will have more money to save, invest, and help grow our economy. More generally, these measures will stimulate economic growth at a time when the global economy is cause for concern, to ensure that all Canadians will benefit.

The second challenge we are facing, and this may be the biggest one, has to do with creating the conditions for strong, long-term economic growth. Smart, targeted investments in infrastructure are essential to stimulating economic growth. Furthermore, now is the time to invest, while interest rates are at all-time lows.

Canadians made it clear that they want real change. They want their government to govern differently. They want to be able to trust their government and they want leadership that is focused on what is most important to them.

We are listening. Since early January, the Minister of Finance and I have been criss-crossing the country holding pre-budget consultations organized by the Department of Finance. We have gathered some very good ideas and excellent comments. Canadians have told us that they are concerned about the state of our infrastructure, including bridges, roads, public transit, sewers, and seniors' homes.

Canadian cities are growing rapidly, and all levels of government are facing the same challenge: making infrastructure investments that generate economic benefits for Canada and promote sustainable urban environments.

Over the next decade, we will invest $120 billion in public infrastructure. Our investments will focus on making life better for Canadians and developing more lucrative business opportunities for our exporters.

To ensure that we are making strategic investments, we will work with the provinces and territories to address their most urgent needs. That is what Canadians expect of us. They want us to work together to make progress and begin building a better Canada.

A number of initiatives are important to our government's growth strategy for Canada. First, environmental sustainability will be central to the development of our natural resources sector. Together with our North American partners, Canada can and should be one of the most efficient and responsible energy producers in the world.

We will also support growing businesses to help them attract the talent, capital, and innovation they need to capitalize on business opportunities in the global market.

We will work with the provinces to develop a skills and labour strategy that promotes greater participation of under-represented groups.

We will work with the provinces and territories to improve the Canada Pension Plan and help Canadians achieve their retirement income security goals.

These are important objectives that can have a significant impact on our long-term growth.

In closing, there is no quick and easy solution. We are lucky to live in such a diverse and prosperous country. However, the challenges we are facing today are real and to overcome them we must find common ground despite our different points of view. I can assure my colleagues that our government is prepared to meet these challenges.

[Chandra Arya, Liberal, Nepean, ON]

Mr. Speaker, to begin, I would like to address today's motion and reassure the hon. member that we support the officials in the Department of Finance. They are consummate professionals who are working hard drafting our government's first budget. Like the members on this side of the House, they know that a snapshot in time is just that. It does not tell the whole story. It is like looking at one's bank account before paying the bills.

Let us make no mistake. The projections outlined in the economic and fiscal update show that there will be a deficit in budget year 2015-16 as a direct result of the previous government's failure to prepare for a downturn in global oil prices and volatility in the global market.

Happily, we have a plan. After 10 years of weak growth, this government has a plan to grow the economy and create jobs by focusing on the middle class, investing in infrastructure, and helping those who need it most.

As the Prime Minister recently said, we fully intend to take all means necessary to support an economic growth strategy that will benefit all Canadians.

Our government was elected on ambitious economic measures. We know that there has never been a better time to make targeted investments to support economic growth. If the members opposite are patient, we will certainly provide them with our vision for the future and the details of these targeted investments.

Let me describe our starting point. As we embark on an agenda of economic growth and long-term prosperity, there is no doubt that we are facing considerable headwinds. Globally, we continue to experience what the International Monetary Fund's managing director, Christine Lagarde, famously called the “new mediocre”. In its latest world economic outlook, in January, the IMF said that it expects global growth to pick up modestly to 3.4% in 2016 and 3.6% in 2017. This is down 0.2 percentage points for both 2016 and 2017 compared to the October 2015 world economic outlook.

Although the recent performance of the U.S. economy is encouraging, the emerging economies, especially China, are causes for concern. Global crude oil prices remain at levels less than a third of what they were mid-2014, reflecting a persistent global oversupply and softening demand. What is happening beyond our borders has real and tangible effects for all Canadians.

In Canada, our economic performance in the first half of 2015 was poor, mainly due to collapsing oil prices in 2014. It has become obvious that growth in Canada will be lower than was expected in the previous government's last budget projections, in April 2015. This, of course, has important implications for our current fiscal situation. Indeed, the Department of Finance's own numbers in the economic and fiscal update, tabled in this House, show this. I find it strange that the members opposite only seem to respect the numbers from department officials when they feel that they can score political points with them. I urge them all to review the economic and fiscal update, and in the spirit of respect for this country's public servants, admit that they are dead wrong in believing that we will not be in a deficit by the end of this fiscal year.

The previous Liberal government left behind a $13-billion surplus in 2006. The Conservative government squandered the surplus and accumulated an additional $150 billion in new debt while still managing to deliver the worst growth record since the Great Depression. The “Fiscal Monitor” referred to in the member's motion is a snapshot in time and does not tell the full story.

Tough economic times call for bold measures to support the middle class and those working hard to join it. We in the government are prepared to implement these measures.

We maintain an enviable position here in Canada, with a low debt-to-GDP ratio, abundant natural resources, and one of the most educated and talented workforces in the world. Keeping our debt-to-GDP ratio on a downward path throughout our mandate remains a central plank of our economic agenda, alongside balancing the budget by the end of our mandate. To achieve this, our policies will strike a balance between fiscal responsibility and our commitments to Canadians.

One of the most important pillars of our plan is strengthening our middle class, the backbone of our economy, whose members have gone too long without a raise. This is why one of the government's first orders of business was to table a notice of ways and means motion to cut taxes for the middle class. We would cut taxes for nine million Canadians by asking the wealthiest 1% of earners to kick in just a little more. This is the right thing to do and the smart thing to do for our economy.

The middle-class tax cut and the accompanying tax changes would help make taxes fairer so that all Canadians would have the opportunity to succeed and prosper. I am pleased to note that Bill C-2, the bill to implement these measures, is now being debated in Parliament. The middle-class tax cuts would mark an important first step in our plan for economic growth.

Going forward, the government will introduce proposals in the budget to create a new Canada child benefit. Changes under the new child benefit would begin in July 2016. In addition to replacing the universal childcare benefit, which is not tied to income, the proposed Canada child benefit would simplify and consolidate existing child benefits while ensuring that the help is targeted to those who need it most.

Taken together, these measures will help strengthen the middle class and those working hard to join it, putting more money in their pockets to save, invest, and grow the economy. More broadly, they will help grow our economy in the context of a difficult global economic climate so that all Canadians benefit.

The second challenge the government faces, and the most important one, is creating long-term conditions for strong and durable economic growth. The international community, as well as leaders right here at home, have more or less arrived at the same conclusion: targeted investments in infrastructure are key to driving economic growth. With interest rates at historic lows, now is the right time to invest. Canadian cities have been growing at a rapid rate, and all governments have a shared challenge in making investments in infrastructure that create economic advantages for Canada and more sustainable urban areas.

For the next decade, we will make investments in social infrastructure, like affordable and seniors' housing, in green infrastructure, like water-treatment systems, and in public transit. We have pledged to make historic investments in Canadian infrastructure, and we intend to follow through. These investments will aim to get Canadians moving and will open more cost-efficient trade options for our exporters. These are big, meaningful measures that can have a significant impact on our long-term growth.

Unlike the previous government, we do not intend to recklessly add to the national debt on the backs of our children and grandchildren by making reckless and politically motivated investments. Rather, we intend to make smart investments that will build an even more prosperous country for our children and grandchildren.

Given the government's clear objectives listed today, I would strongly encourage hon. members to support the government in our efforts to strengthen the middle class and grow the economy.

Business of the House

[Dominic LeBlanc, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, in spite of his best efforts, we just had a good example of embellishment right there. Why do I not focus on the very erudite question that comes on Thursdays that I know members look forward to all week.

This afternoon we will resume debate on the Conservative Party's opposition motion.

Tomorrow, the House will debate Bill C-2, which amends the Income Tax Act, at second reading, and we will continue that important debate on Monday.

Tuesday, February 2, will be another opposition day.

On Wednesday, we will debate Bill C-4, which repeals the Conservatives' unfair union bills. As colleagues know, this important legislation was introduced this morning.

Lastly, Thursday, February 4, will be another opposition day.

Opposition Motion—Energy East Pipeline Project

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Mr. Speaker, I thank the hon. member and congratulate him on his election as well.

As I mentioned in my speech, our Prime Minister made a promise in our election platform that this is the party and this is the government that is going to help the middle class. Every policy that is coming in is helping it. Bringing in Bill C-2, as I said earlier, reducing income tax from 22.5% to 20.5%, would help middle-class families. Bringing in a Canada child benefit would help the families who need the most. These are the types of policies we need, and these are the types of policies our government is going to deliver in the coming months and years.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Mr. Speaker, first, I congratulate the nominees who sit in this chair, and I am sure the constituents of Nipissing—Timiskaming are very proud of the hard and diligent work you do, not only for your constituents but for Canadians.

I am proud to stand today to speak about our government's economic agenda.

This is a difficult period for the Canadian economy. China has slowed down dramatically, and commodity prices have dropped globally. The Bank of Canada has adjusted its economic forecast and has cut interest rates twice over the last 12 months. Now, more than ever, is the time for our government to look toward long-term growth, growth that will provide good jobs for Canada's middle class, the lifeblood of our economy. This is why we introduced Bill C-2, which provides a middle-class tax cut to support Canadian families.

My constituents of Surrey—Newton are happy to finally have a government that believes that they too deserve tax relief. The Liberal middle-class tax cut will lift $3 billion in tax burden from the backs of middle-class income earners.

Bill C-2 will reduce the middle-income tax rate from 22% to 20.5%. It will also reduce the contribution limit on tax-free savings accounts from $10,000 to $5,500. This will benefit about nine million Canadians, which accomplishes two important objectives. First, it will restore fairness to the tax system by treating middle-income earners on par with the highest earning bracket and corporate Canada, which received the majority of tax relief from the previous government.

Just as important, this is a middle-class tax cut that is designed to stimulate the economy. The Bank of Montreal's chief economist, Doug Porter, has stated that this tax cut will encourage an increase in consumer spending and might compel middle-class earners to work more, because they will be able to keep more of their paycheques in their pockets.

History has shown that a middle-class tax cut has one of the highest returns on investment for a government, because it spurs growth by encouraging spending in the local economy. This is why, in Surrey—Newton and across Canada, small businesses are also supportive of this measure. It means that they will see a direct positive impact.

However, this is not the only way this government is putting money back into the pockets of families. The new Canada child benefit creates a simpler, more generous, and tax-free infusion for families with children.

Investment does not stop there. We will also invest in cities, the economic engines that are critical to the success of our national economy. In Surrey Newton, we see the strain that is caused by rapid growth. The city of Surrey continues to welcome over 1,000 new residents per month, and we need to continue to improve our municipal services to accommodate this growth.

This Liberal government has committed to investing $125 billion over the next 10 years to upgrade public infrastructure and public transit. The newly proposed LRT line in Surrey is absolutely essential for strong public transit long into the future. Within the next 30 years, Surrey will emerge as the largest city in British Columbia, and easily accessible public transit is critical to that evolution.

Our government understands that investing in Canada's economy must be balanced, but it also means that we will never give up on working to get our natural resources to international markets. Our Prime Minister and this government will never forget that 1.8 million jobs are directly and indirectly attached to natural resources across Canada.

This government looks far into the future of Canada's economy and plans for long-term sustainability and growth. This will be accomplished in a number of specific ways: by ensuring that environmental sustainability is at the heart of Canada's resource sector, which will make Canadian resources globally attractive; by working with the provinces and territories to ensure that under-represented groups are represented in a new skills and labour strategy; by supporting growing firms in attracting talent and investment while still incorporating innovation in their operations; and by enhancing the Canada pension plan co-operatively with our provincial and territorial partners to ensure that all Canadians have access to a secure retirement. I cannot emphasize how important this kind of approach is to the future success of all Canadians.

In Surrey, we had the pleasure of being one of the six cities to host the hon. Minister of Finance during the pre-budget consultation tour. The minister was able to hear a wide range of perspectives from one of the most dynamic communities in Canada, and one of the key messages was this: Canada can no longer place all of its eggs in one basket. We must look for balance. We must invest in the middle class, in cities, and in different industries, and we must take the long view for our future generations.

These are the same messages we are hearing from Canadians from coast to coast to coast. We have reached nearly 150,000 Canadians in these pre-budget consultations, through technology and through in-person meetings. This is the largest participation in pre-budget consultations in Canadian history. We are proud of this inclusive approach, which will come to define everything our government does over the next four years. This is a government for all provinces, all territories, all cities, all financial profiles, all races, and all backgrounds. We are committed to listening to each and every perspective and opinion. This is why our mandate to grow the economy sustainably, responsibly, fairly, and with a long-term vision was supported in Surrey—Newton and across Canada. We will continue to show respect for every single Canadian voice as we work towards presenting our budget in the coming months.

I am proud to say that balance is back in Ottawa.